Hormel Foods Corporation · NYSE:HRL
Hormel Foods — Investor Day (June 2017)
24 slides from Hormel Foods's investor day presentation, Jun 15, 2017
Slide 1: Luis Marconi
Luis Marconi Group Vice President, 17 Years with Hormel Foods Grocery Products Hormel Foods Career History 2016: Group Vice President, Grocery Products 2012: Vice President, Grocery Products Marketing 2009: Managing Director, MegaMex Foods Joint Venture 2006: Manager of International Joint Ventures,
Slide 2: Reinventing Grocery Products
Reinventing Grocery Products Luis Marconi Group Vice President, Grocery Products
Slide 3: Agenda
Agenda • REINVENTING GROCERY PRODUCTS • A Long-Term Growth Story
Slide 4: Reinventing Grocery Products
Reinventing REINVENTING GROCERY PRODUCTS Grocery Products Before ‘08 ‘09 to ‘12 ‘12 to ’16 Our Purpose: To Inspire Consumers With Tasty & Simple Foods Simple Mexican Nut Meals Foods Butters BRAND Our Drivers: Innovation, Branding & Productivity
Slide 5: Aligning With the New Consumer
Aligning With the REINVENTING GROCERY PRODUCTS New Consumer Simple Meals Mexican Foods Nut Butters BOOMER MILLENNIAL GEN-X CONSUMPTION INDEX CONSUMPTION INDEX CONSUMPTION INDEX 110 125 108 IRI Buyer Index Latest 52 weeks ending 3-19-2017
Slide 6: Balancing Our Portfolio
Balancing REINVENTING GROCERY PRODUCTS Our Portfolio Sales Evolution ~20% Nut Butters ~35% ~30% BRAND Mexican Foods BRAND Mexican Foods ~100% ~70% ~45% Simple Meals Simple Meals Simple Meals F'08 F'12 F'16 Internal Data
Slide 7: Increasing Our Brand Support
Increasing Our REINVENTING GROCERY PRODUCTS Brand Support F'12 F'16 Internal Data
Slide 8: Translating Insights into Meaningful Innovation
Translating Insights into REINVENTING GROCERY PRODUCTS Meaningful Innovation Peanut Butter Fresh Guacamole Out Of The Jar + Snacking Salsa Nut Butters + Guacamole On-The-Go
Slide 9: Consistent, Profitable Growth
Consistent, REINVENTING GROCERY PRODUCTS Profitable Growth Net Sales Segment Profits 1,800,000 300,000 1,600,000 10-YEAR 10-YEAR 250,000 1,400,000 CAGR +7% CAGR +7% 1,200,000 200,000 1,000,000 150,000 800,000 600,000 100,000 400,000 50,000 200,000 - - Internal Data
Slide 10: Agenda
Agenda • Reinventing Grocery Products • A LONG-TERM GROWTH STORY
Slide 11: Reinventing Grocery Products
Reinventing A LONG-TERM GROWTH STORY Grocery Products Our Purpose: To Inspire Consumers With Tasty & Simple Foods Simple Mexican Nut Meals Foods Butters BRAND Nurture Category Outgrow A Growing Scale Up & Innovate Defining Legacy Brands Category In Snacking Our Drivers: Innovation, Branding & Produc
Slide 12: Simple Meals: Nurturing Category-Defining Legacy Brands
Simple Meals A LONG-TERM GROWTH STORY Nurturing Category-Defining Legacy Brands Brand Category $M Dollar Share Share Change $228 90.0% +0.1 pp $171 79.2% +6.0 pp $83 78.2% +1.6 pp $103 67.7% -0.7 pp MINIMAL CAPEX $537 41.3% +0.3 pp IRI Last 52 weeks ending on 3-19-2017
Slide 13: Simple Meals
Simple Meals A LONG-TERM GROWTH STORY TODAY… …GOING FORWARD Effortless meal creativity Engaging consumers in novel ways Defines the category Multicultural - Asian: 257, Hisp: 132 2 Iconic equity Multi-channel expansion Net Sales 1 F'12 F'16 1 Internal data; 2 Buyer Consumption Index IRI Panel Last 5
Slide 14: Supporting Our Brands
Supporting A LONG-TERM GROWTH STORY Our Brands
Slide 15: Nut Butters: Scaling Up & Innovating
Nut Butters A LONG-TERM GROWTH STORY Scaling Up & Innovating + 2.0 18.5 16.5 2013 2016 Hormel Foods Nut Butter Market Share % IRI Last 52 weeks ending on 3-19-2017
Slide 16: Nut Butters
Nut Butters A LONG-TERM GROWTH STORY TODAY GOING FORWARD SKIPPY® brand spreads simple fun! SKIPPY YIPPEE!® Brand building Innovation leader Snacking innovation Iconic brand equity Distribution runway Household Penetration (%) Dollar Share (%) 24.9 24.0 19.5 16.9 2013 2016 2013 2016 IRI Last 52 weeks
Slide 17: Nut Butters
Nut Butters A LONG-TERM GROWTH STORY ON TRACK BRAND • Completion of strategic integration • Points of distribution +31% since acquisition Household Penetration (%) Dollar Share (%) 5.4 25.0 Almond Peanut Confection Butter Butter 2.9 12.4 ACV 60% 16% 26% 2014 2014 2016 Chg. L52 Weeks +7pp +7pp +8pp 2
Slide 18: Supporting Our Brands
Supporting A LONG-TERM GROWTH STORY Our Brands
Slide 19: Mexican Foods: Outgrowing a Growing Category
Mexican Foods A LONG-TERM GROWTH STORY Outgrowing a Growing Category Retail Sales Household Penetration (%) Growth % + 2.8 12% + 1.8 10% 9.2 7.5 6.4 5.7 Mexican Foods BRAND 3% BRAND Mexican Foods Herdez Wholly 2013 2016 2013 2016 IRI Last 52 weeks ending on 4-9-2017
Slide 20: Mexican Foods
Mexican Foods A LONG-TERM GROWTH STORY TODAY GOING FORWARD Fastest growing salsa Increasing brand awareness Guacamole salsa innovation Exploring authentic flavors Authentic equity Distribution in the East Retail Sales ($m) $59M $45M 2013 2016 IRI Last 52 weeks ending on 4-9-2017
Slide 21: Mexican Foods
Mexican Foods A LONG-TERM GROWTH STORY TODAY GOING FORWARD #1 Guacamole in America Lifestyle brand Superfood Innovation in refrigerated dips Innovative BRAND Distribution Other 27% 40% Private Label 8% Peer 2 Peer 1 10% 15% IRI Last 52 weeks ending on 4-9-2017
Slide 22: Supporting Our Brands
Supporting A LONG-TERM GROWTH STORY Our Brands BRAND
Slide 23: Grocery Products Will Grow 3% Top Line & 6% Bottom Line
A LONG-TERM GROWTH STORY Grocery Products Will Grow 3% Top Line & 6% Bottom Line Our Purpose: To Inspire Consumers With Tasty & Simple Foods Simple Mexican Nut Meals Foods Butters BRAND Nurture Category Outgrow A Growing Scale Up & Innovate Defining Legacy Brands Category In Snacking Our Drivers: In
Slide 24: Reinventing Grocery Products
Reinventing Grocery Products Luis Marconi Group Vice President, Grocery Products